The Way We See It...
The final quarter of this year has been quite impressive from an investors standpoint, as many of the uranium stocks have nearly doubled in price and many are trading near their highs for the year as well. It seems that we rushed everyone into the Labrador Exploration companies right before they were 'discovered' by everyone else (we realize that one was recommended by another newsletter writer, but a gain is nevertheless a gain!). We will be paying close attention to the rest of the world's uranium mining districts to find which area will have the next spike upwards, and at that time will notify you, most likely in the same format as last time.
We have an end of year newsletter due out soon, and we will be sure to notify everyone when that is ready (we expect it to be out by January 10). This will cover the past year and our expectations for the year to come (a very broad market commentary). At this time it looks highly unlikely that we shall have any new picks by that time, however shall a buying opportunity emerge, we will quickly jump at the opportunity.
Looking at what happened today on the Toronto, we see that there is the possibility that investors will begin to 'bargain hunt' among the uranium stocks that have not experienced the dramatic run-up as their peers. We believe that these companies are not of the same quality as some of our favorites, but realize that they are probably better than the garbage that will eventually be offered to investors through IPOs in the future. This trend of bottom fishing has begun in earnest, and shall escalate as investors strive to leave no stone unturned in their quest to find the next big discovery. Our advice is that you should follow the established explorers around and discover the hidden gems within their exploration groups. Think of this as a sort of derivatives play in which you buy the cheaper security for the same total price and hopefully get a larger proportional share of the company you invest in. Please remember that we like to invest in companies that have low share floats and many promising projects.
Please do not think that this is a new idea that we are just presenting to you, because it is not. This has been one of the fundamental rules that we have been investing by since we began this foray into the uranium miners. We chose Pitchstone over Triex because Pitchstone was one of those half off sales (compared to Triex on market cap at the time) and had what seemed to be two times the number of properties for exploration, not to mention the quality of the properties. It must be noted that both of these companies own a project together, and split it down the middle...but one was worth two times the amount of the other at the time! It was one of those strange situations when the best company was undervalued even though it had better properties and was not spending a penny on the majority of its exploration stage projects.
The trend carries on, think Santoy, Monster Copper, and Silver Spruce. That was the order we believed them to be worth from greatest to least, and amazingly that is the order in which investors have discovered them. If you simply scratch the surface on the CMB (Central Mineral Belt) in Labrador you would have discovered Santoy and realized that it was more than a one trick pony (most investors would have been perfectly happy with this discovery). However if you would have taken the discovery process to the next stage you would most surely have found Monster Copper and realized that maybe this was an interesting play as they had half the properties that Santoy possessed in the CMB and were not paying a dime on the exploration costs, in fact they were getting paid to let Santoy explore the land! This admittedly made us quite smug with ourselves, but we were still intrigued by Silver Spruce, and kept watching it. The more we watched it, the more we realized that it tracked the rest of the CMB pretty well, but their was a bit of a lag. This figured perfectly into our plan and thus the recommendation. Silver Spruce was that small Las Vegas style bet we placed knowing that when investors found the CMB that it would rise regardless due to its properties held there. So far it has lagged behind Santoy and Monster as its projects have not been blessed by a certain newsletter writer, but we believe that they will have their day as they play catch-up.
Our returns from this trade stand at (as of January 1, 2007):
Santoy Resources: 120%
Monster Copper: 61.54%
Silver Spruce Resources: 27.27%
These were our recommendations on November 3, 2006 and in two months these are the rewards reaped from our work. We believe that this is a taste of what the future holds in beating the herd into the best of what the uranium mining industry has to offer.
For those of you willing to do your research, we have been very intrigued with some of the small partners of Energy Metals. Many of them possess the small floats desired as well as projects with actual historic deposits. These small companies will be gobbled up first and when they are partnered with large companies there is always the possibility of getting taken out. These companies may be where the next run is, but as stated earlier we are not sure when or who we shall will recommend what we perceive as the next group to push forward.
We hope that the new year ushers in the same type of gains as experienced this year by all those investing in uranium. We hope that this Holiday Season was as good for our readers and their families as it was for ours and wish the best of luck to all in their future endeavors.
We have an end of year newsletter due out soon, and we will be sure to notify everyone when that is ready (we expect it to be out by January 10). This will cover the past year and our expectations for the year to come (a very broad market commentary). At this time it looks highly unlikely that we shall have any new picks by that time, however shall a buying opportunity emerge, we will quickly jump at the opportunity.
Looking at what happened today on the Toronto, we see that there is the possibility that investors will begin to 'bargain hunt' among the uranium stocks that have not experienced the dramatic run-up as their peers. We believe that these companies are not of the same quality as some of our favorites, but realize that they are probably better than the garbage that will eventually be offered to investors through IPOs in the future. This trend of bottom fishing has begun in earnest, and shall escalate as investors strive to leave no stone unturned in their quest to find the next big discovery. Our advice is that you should follow the established explorers around and discover the hidden gems within their exploration groups. Think of this as a sort of derivatives play in which you buy the cheaper security for the same total price and hopefully get a larger proportional share of the company you invest in. Please remember that we like to invest in companies that have low share floats and many promising projects.
Please do not think that this is a new idea that we are just presenting to you, because it is not. This has been one of the fundamental rules that we have been investing by since we began this foray into the uranium miners. We chose Pitchstone over Triex because Pitchstone was one of those half off sales (compared to Triex on market cap at the time) and had what seemed to be two times the number of properties for exploration, not to mention the quality of the properties. It must be noted that both of these companies own a project together, and split it down the middle...but one was worth two times the amount of the other at the time! It was one of those strange situations when the best company was undervalued even though it had better properties and was not spending a penny on the majority of its exploration stage projects.
The trend carries on, think Santoy, Monster Copper, and Silver Spruce. That was the order we believed them to be worth from greatest to least, and amazingly that is the order in which investors have discovered them. If you simply scratch the surface on the CMB (Central Mineral Belt) in Labrador you would have discovered Santoy and realized that it was more than a one trick pony (most investors would have been perfectly happy with this discovery). However if you would have taken the discovery process to the next stage you would most surely have found Monster Copper and realized that maybe this was an interesting play as they had half the properties that Santoy possessed in the CMB and were not paying a dime on the exploration costs, in fact they were getting paid to let Santoy explore the land! This admittedly made us quite smug with ourselves, but we were still intrigued by Silver Spruce, and kept watching it. The more we watched it, the more we realized that it tracked the rest of the CMB pretty well, but their was a bit of a lag. This figured perfectly into our plan and thus the recommendation. Silver Spruce was that small Las Vegas style bet we placed knowing that when investors found the CMB that it would rise regardless due to its properties held there. So far it has lagged behind Santoy and Monster as its projects have not been blessed by a certain newsletter writer, but we believe that they will have their day as they play catch-up.
Our returns from this trade stand at (as of January 1, 2007):
Santoy Resources: 120%
Monster Copper: 61.54%
Silver Spruce Resources: 27.27%
These were our recommendations on November 3, 2006 and in two months these are the rewards reaped from our work. We believe that this is a taste of what the future holds in beating the herd into the best of what the uranium mining industry has to offer.
For those of you willing to do your research, we have been very intrigued with some of the small partners of Energy Metals. Many of them possess the small floats desired as well as projects with actual historic deposits. These small companies will be gobbled up first and when they are partnered with large companies there is always the possibility of getting taken out. These companies may be where the next run is, but as stated earlier we are not sure when or who we shall will recommend what we perceive as the next group to push forward.
We hope that the new year ushers in the same type of gains as experienced this year by all those investing in uranium. We hope that this Holiday Season was as good for our readers and their families as it was for ours and wish the best of luck to all in their future endeavors.
posted by -theinvestar @ 1/03/2007 01:55:00 AM
1 Comments:
At 6:31 PM,
Anonymous said…
Good coverage on the CMB belt. Leaving out the Basin aside (which obviously holds the most verified deposits in Canada), the CMB now looks like a bigger and bigger prize all the time (with AXU leading the way and now CXX).
Next up is James Bay and Otish mountains in Quebec (led by RSC and AZM) which may not be as big a catch a the CMB.
The one that intrigues me, however, is the Wernecke Breccia in Yukon. I can't seem to get to ignore it (especially when I see the level of interest in it - led by AXU's parent and director Mark O'Dea with FRG as well as TwentySeven Capital and CHX). Do you believe this might turn out to be as big as the CMB especially when considering that geologically this could not only hold an IOCG type deposit but also an Athabasca Basin type high concentration unconformity occurence.
Any thoughts?
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